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Implant maker Mentor Corp., is willing to ante up cash and stock in its $2.2 billion bid to acquire Medicis, said Mentor CEO Joshua Levine, in a conference call with investors Monday.
Despite a rebuff Sunday to an all-stock offer, Mentor is confident of making the deal. "We believe the combined company would be an aesthetic powerhouse," Levine said. "I am confident we can arrive at a transaction (if we) wait for the dust to settle."
Levine sent an e-mail to Medicis chairman Jonah Shacknai on Friday, offering to buy the Scottsdale company for $2.2 billion in stock.
Mentor offered Medicis shareholders 0.62 shares of Mentor common stock per Medicis share, a 25 percent premium, Levine said. Medicis would own 44 percent of the combined company if it approves the deal.
Mentor said its board has backed the transaction, and that it is superior to Medicis’ planned $2.8 billion purchase of Mentor rival Inamed Corp.
Medicis, however, said Monday it is committed to buying Inamed, a deal the companies announced in March and have been planning to complete by year-end.
"On Nov. 20, the Medicis board met with our financial and legal advisers to discuss the Mentor proposal. The board unanimously voted to reject Mentor’s proposal based on the belief that it is not in the best long-term interests of Medicis shareholders," according to an official statement Medicis issued Monday. "Medicis is committed to our pending merger with Inamed and will proceed with the announced meeting and shareholder vote on the Inamed transaction on Dec. 19."
That union , however, already is in jeopardy.
Last week, Botox maker Allergan Inc. offered $3.2 billion for Inamed. Inamed’s board instructed the company’s management to consider the alternative pairing.
If Inamed rejects Medicis in favor of Allergan, Medicis is poised to snag a break-up fee of at least $90 million and could still pick up Reloxin, Inamed’s Botox-like wrinkle relaxer. Allergan said if the deal with Inamed is a go, it will divest Reloxin rather than risk regulatory anti-trust delays.
A Medicis spokeswoman would not comment on whether Medicis would look again at Mentor’s proposal if it is spurned by Inamed.
Levine said the proposed Medicis-Mentor deal would not have the same anti-trust risks as the Medicis-Inamed transaction and could close as soon as first quarter.
"Medicis would have the same strategic advantage on more favorable economic terms," he said.
Levine would not say whether he would take the Medicis offer directly to shareholders in a hostile takeover bid if Medicis’ board doesn’t come around.
Apparently Medicis shareholders are listening. The company’s shares soared 14 percent to $31.57 in Monday trading.
If Medicis and Mentor merge, the combined company would have annual revenue of nearly $900 million, Levine said. It would offer products for breast augmentation, facial aesthetics, body contouring and dermatology.
Levine said face enhancements and breast enhancements traditionally have the same customer base.
While cosmetic surgical procedures are growing at a 100 percent annual rate, nonsurgical procedures, such as injections of Medicis’ popular wrinkle filler Restylane, are growing 700 percent, he said.
Mentor and Inamed are awaiting a decision from the Food and Drug Administration on the marketing of silicone-gel breast implants, which have been off the U.S. market for the past 13 years. |
